WEEKLY MARKET RECAP – FEBRUARY 2, 2024
On Wednesday, the major stock indexes experienced a decline after a Fed meeting but recovered to secure gains on Thursday and Friday. The S&P 500, the Dow, and the NASDAQ all recorded increases of more than 1% overall. This marked the 13th positive outcome for the S&P 500 out of the past 14 weeks.
Despite elevated interest rates, the U.S. labor market exhibited resilience, with January witnessing a job gain of 353,000—roughly double the number anticipated by most economists. Moreover, revisions upward for the previous two months added a total of 126,000 jobs, while the unemployment rate held steady at 3.7%.
The Fed opted to maintain unchanged interest rates at the highest level in over two decades. Chair Jerome Powell suggested that a rate cut in March is “probably not the most likely case” but indicated that a cut might be considered in 2024, contingent on increased confidence in the ongoing easing of inflationary pressures.
For January, the S&P 500 achieved its third consecutive monthly gain, accumulating a total increase of 15.5% over that period. The index rose 1.6% overall last month, surpassing its record closing level six times, notably crossing the 4,800-point mark on January 19 and reaching 4,900 ten days later.
The bond market experienced volatility late in the week as the yield of the 10-year U.S. Treasury bond dropped to 3.82% on Thursday before rebounding above the 4.00% threshold the following day. Friday’s surge to a closing yield of 4.03% was influenced by a stronger-than-expected monthly jobs report, fostering expectations of a postponed interest-rate cut.
The eurozone’s economy concluded 2023 with stagnant growth, posting a 0.0% fourth-quarter GDP figure after a slight contraction in the previous quarter. The last notable growth for the continent was recorded in the third quarter of 2022, with an annual growth rate of 0.5%.
Oil prices experienced a decline of over 7% for the week, erasing most of the year-to-date gain. On Friday, U.S. crude was trading at approximately $72 per barrel, down from a recent high of over $90 in September.
Small-cap stocks deviated from the predominantly positive trend in the U.S. stock market for the week, with a small-cap benchmark falling 0.8%. This outcome widened the gap between small-caps and their large-cap counterparts on a year-to-date basis, continuing the lag observed throughout 2023.
Major U.S. Economic Reports
| Report | Period | Actual | Previous |
| S&P Case-Shiller home price index (20 cities) | Nov. | 5.4% | 4.9% |
| Job openings | Dec. | 9.0 million | 8.9 million |
| Consumer confidence | Jan. | 114.8 | 108.0 |
| ADP employment | Jan. | 107,000 | 158,000 |
| Employment cost index | Q4 | 0.9% | 1.1% |
| Chicago Business Barometer (PMI) | Jan. | 46 | 47.2 |
| Initial jobless claims | Jan. 27 | 224,000 | 215,000 |
| U.S. productivity | Q4 | 3.3% | 4.9% |
| S&P U.S. manufacturing PMI (final) | Jan. | 50.7 | 50.3 |
| ISM manufacturing | Jan. | 49.1% | 47.4% |
| Construction spending | Dec. | 0.9% | 0.9% |
| U.S. jobs report | Jan. | 353,000 | 333,000 |
| U.S. unemployment rate | Jan. | 3.7% | 3.7% |
| U.S. hourly wages | Jan. | 0.6% | 0.4% |
| Hourly wages year over year | 4.5% | 4.3% | |
| Factory orders | Dec. | 0.2% | 2.6% |
| Consumer sentiment (final) | Jan. | 79 | 78.8 |
| U.S. auto sales | Jan. | 15.0 million | 16.1 million |
Closing Prices for the Week
| Contract | Close |
|---|---|
| Dow Jones Industrials Average | 38,654.42 |
| Nasdaq Composite | 15,628.95 |
| S&P 500 Index | 4,958.61 |
| CBOE Volatility Index | 13.85 |
| S&P GSCI | 540.00 |
| U.S. Dollar Index | 103.922 |
| 10-Year T-Note (Mar ’24) | 111-210 |
| Crude Oil WTI (Mar ’24) | 72.28 |
| Natural Gas (Mar ’24) | 2.079 |
| Gold (Apr ’24) | 2,053.7 |
| Silver (Mar ’24) | 22.796 |
| Corn (Mar ’24) | 442-6 |
| Wheat (Mar ’24) | 599-6 |
| Soybean (Mar ’24) | 1188-4 |
| Coffee (May ’24) | 189.00 |
| Sugar #11 (Mar ’24) | 23.89 |
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